Coinbase Accuses SEC of Destroying Text Messages
U.S.-based cryptocurrency exchange Coinbase has accused the Securities and Exchange Commission (SEC) of deleting nearly a year’s worth of text messages from former Chair Gary Gensler. Coinbase asked a federal court in Washington to impose sanctions on the SEC over this issue.
The lost messages have limited Coinbase’s ability to review the SEC’s strict cryptocurrency policies under Gensler’s leadership. This claim appeared in a Thursday legal filing. The filing supports litigation by History Associates, a research group seeking Gensler’s communications through the Freedom of Information Act.
SEC’s Text Message Deletion Policy Under Scrutiny
History Associates’ lawyers said the SEC failed to provide relevant records. They blamed a device policy that automatically deletes messages if a phone is offline for more than 45 days. Coinbase’s Chief Legal Officer confirmed on X that an SEC Inspector General report revealed texts from October 2022 to September 2023 were destroyed.
Gensler served as SEC Chair from 2021 to early 2025. During his term, he led about 100 cases against crypto firms to protect investors from fraud. He focused on exchanges and major players, tightening crypto rules under the SEC’s guidance.
This period was challenging for the crypto industry. Key events included Ethereum’s shift to proof of stake, the collapse of FTX, and multiple SEC enforcement actions against exchanges. Coinbase also raised concerns about possible loss of records from other senior SEC officials.
Coinbase Seeks Court Sanctions Against SEC
Coinbase argues the SEC violated court orders by failing to search text messages. This could justify sanctions against the regulator. The company has criticized the SEC for regulating through enforcement rather than clear rules. This dispute highlights ongoing tensions between Coinbase and the SEC.
Legal experts say courts take evidence destruction seriously, especially after a request for documents. Sanctions can include additional searches or limits on court arguments. However, judges consider whether the loss was intentional.
Coinbase wants the SEC held accountable and argues the regulator should not benefit from losing key communications. The court is expected to decide on the next steps in the coming weeks.
